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You are viewing ARCHIVED CONTENT released online between 1 April 2010 and 24 August 2018 or content that has been selectively archived and is no longer active. Content in this archive is NOT UPDATED, and links may not function.By Paul Chandler, Lei Shen
Many merger and acquisition (“M&A”) agreements lack specific representations and warranties regarding privacy issues. Often, this is because deal lawyers do not recognize potential privacy risks where the target company (the “Target”) lacks e-commerce websites or retail stores that collect consumer data. Nonetheless, significant privacy issues may exist even if the Target is a traditional “brick and mortar” business. Early attention to privacy issues in M&A transaction planning and due diligence can mitigate risks for both buyers and sellers.
Recent high-profile government enforcement actions highlight the need to analyze potential privacy risks. For example, Facebook’s acquisition of WhatsApp in February 2014 resulted in the US Federal Trade Commission (“FTC”) sending a warning to both companies that the failure to honor WhatsApp’s personal data promises to its customers would constitute a deceptive act under the FTC Act. Likewise, Barnes & Noble’s recent acquisition of Borders’ customer list garnered intense FTC scrutiny due to past promises by Borders not to share its customers’ data without their consent.
Read the complete article at: Key Privacy Issues in M&A Transactions